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US, EU farmers feel hit from Russia food ban

Mary Clare Jalonic; and Juergen Baetz
3:10 p.m. CDT August 9, 2014

Soybeans like these harvested in Crowley are just one of the crops Russian sanctions recently imposed on produce and other foodstuffs from the U.S., the European Union and Canada will keep out. Ag economists in these countries are pondering the effect of the politically-driven ban.
(Photo:
File Photo/Leslie Westbrook, The Advertiser
)

WASHINGTON – Russian diners will not be able to find creamy Dutch cheeses or juicy Polish apples in the grocery store or cook chicken from the United States — the result of a Russian ban on most food imports from the West.

Although the U.S., Canada and the European Union together will take more than a $17.5 billion hit from the one-year ban, Russian consumers may feel it more than Western farmers.

Jason Furman, the chairman of the White House Council of Economic Advisers, shrugged off the import ban’s impact as negligible, in contrast to Western sanctions on Russian individuals, businesses and economic sectors.

There’s a “cruel irony” in Russia’s import ban, said David Cohen, the Treasury Department undersecretary in charge of economic sanctions. “What the Russians have done here is limit the Russian people’s access to food,” Cohen said. “We don’t do that. Our law doesn’t allow us to do that.”

What’s at stake?

The United States exported about $1.2 billion in food and agricultural goods to Russia last year, less than one percent of total U.S. agriculture exports. The EU exported about 11.8 billion euros ($15.8 billion) to Russia, about 10 percent of its total agriculture exports.

Who is hit the hardest?

In the EU, Poland, France, the Netherlands and Germany will feel much of the loss.

President Xavier Beulin of a French farm union said the Russian import ban could affect the country’s fruit and vegetable industry.

The impact is less in the United States. The largest U.S. export to Russia is poultry, mainly chicken, followed by tree nuts such as almonds, and also soybeans. In a statement, the National Chicken Council and the USA Poultry and Egg Export Council said Russia buys a little more than $300 million in U.S. chicken annually, about 7 percent of the industry’s total exports. The chicken groups said they did not expect the ban to have a major impact on the industry.

Impact on Russia

The biggest impact could be on Russian consumers. Russia received up to 55 percent of its agricultural imports from the countries it has so far sanctioned, including the United States, European Union, Ukraine, Australia and Canada, according to an Associated Press analysis of figures from the U.N. Food and Agriculture Organization.

Almost half of Russia’s meat imports — about 47 percent — last year came from the countries it has slapped sanctions on, according to the FAO figures. Russia will likely import more from its other main suppliers, namely Brazil and Paraguay.

About 95 percent of Russia’s dairy imports last year came from countries it has now sanctioned, with its biggest suppliers until now being Ukraine, the Netherlands, Germany, Lithuania, Finland and Poland.